Public utilities lists growth as number one goal

Growth and development of electric and natural gas customers is the number one goal listed in the public utilities' two-year business plans presented at the Lexington City Council retreat Tuesday.

BY REBEKAH CANSLER MCGEEThe Dispatch

Growth and development of electric and natural gas customers is the number one goal listed in the public utilities' two-year business plans presented at the Lexington City Council retreat Tuesday.The council finished out the first day of its retreat with presentations from the natural gas and electric department along with an informational seminar from ElectriCities. As part of the two-year business plan for the natural gas department, the top short-term and long-term goals continue to be the same from 2011: add new customers, growth and value to the system and expand based on results of marketing studies. "(From 2011 to 2013) we have totaled about 1,700 net new services," said Chris Smith, director of public utilities. Part of that number includes expansion into the Southmont area. But not only has the public utilities department expanded the natural gas line, but it has completed GPS mapping of the entire system and entering it into Geographic Information Systems. "Back in the past, if the office burned down, there went our maps. Now it is all electronic," Smith added. He pointed out that the GIS was an ongoing project as new lines were introduced to the system or repairs were done to existing lines. Another goal accomplished between now and the past two-year plan was working with the Davidson County Economic Development Commission to identify new areas for commercial growth. Smith noted the partnership with the EDC on the Lowe's Millwork natural gas line as an example of collaboration. "That's a good example of working with the EDC to provide natural gas for industrial customers," Smith said. But he also noted that the department has faced difficult times in light of the county losing industrial customers. The remaining natural gas costs would have to be spread over the remaining customer base, therefore potentially increasing rates."To study and update rates will always be a long-term goal. We update them every three years or as needed and when the industrial customers started leaving, we had to study our rates more often," Smith said. Smith said one of the key long-term goals included looking at "other revenue centers" for natural gas, including natural gas vehicles and possibly converting the city's fleet of vehicles. The department will be conducting a study to see if this conversion is feasible. Natural gas vehicles "are a good option, but it will not work for everything," Smith said of the reason the department was conducting the study. "I think NGV are areas we really need to pursue."Smith also documented growth as the number one goal for the past two years for the electric department as well as moving forward but included in the list were items like providing energy audits, updating outage management system and re-engineering organizational structure to implement GIS and GPS into the electric department.Clark asked Smith why the department provided energy audits to lower customers' bills if the city would still be required to buy the same amount of power from ElectriCities."In short, if everyone cut their bills by 10 percent, we would have to raise rates by 10 percent," said Frank Callicutt, councilman at-large.Smith agreed this statement was true as this was a battle all electric departments faced as appliances and houses become more energy efficient as well as customers becoming more aware of their consumption."The consumption of energy is coming down every year, and we have to find a way to balance that," Smith said. As one of the long-term goals for 2011-15, Smith noted the city wanted to pursue changing to LED street lights. This continues to be a focus for the department and as funds permit, LED lighting will be integrated into the streetlights. Some of the goals for the next two years are to evaluate, implement and market load reduction rates, complete installing the Automated Meter Reading and implement an electric system study to identify future reliability projects.The electric department will continue the capital improvement program to enhance reliability and plan for future growth that includes completing construction on the West Bypass Extension phase 1 between Parkway Plaza and Fairview Drive. The department will also continue to monitor progress on phase 2 between Lowe's Boulevard and South Main Street."We will also continue to partner with ElectriCities economic development staff, the EDC and the Lexington (Area) Chamber of Commerce to recruit new business," Smith said.T. Graham Edwards, CEO of ElectriCities, discussed Lexington's involvement with the power agency. During his presentation, Edwards reviewed the governance structure of the company, the budget of $564 million, projections of rate increases of 5 percent each year through 2016 and the effect of the economy on the power agency. "We can't do anything about the rates right now, but we can do something about the consumption," Edwards said, noting the more customers using power spreads the needs and responsibility."I give citizens the example of everyone is required to buy 10 oranges, but while we're required to buy 10 oranges, we only have six buyers," explained Newell Clark, mayor of Lexington. "Huntersville buys 10 oranges but they have 20 customers, so they can spread that cost."The excess power comes from the fact industries left Lexington. At the time the power supply was negotiated, Lexington needed the increased power to operate the furniture and manufacturing companies. "We may not have the best service, but we do have great service," said Donnie McBride, councilman of Ward 2.

Rebekah Cansler McGee can be reached at 249-3981 ext. 228 or rebekah.mcgee@the-dispatch.com.

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